WTG Gas Processing, LP v. ConocoPhillips Company
(Tex.App.- Houston [14th Dist.] Feb. 23, 2010)(Seymore)(cross appeals, breach of contract and tortious-
interference claims, no contract formed, meeting of the minds on material terms, statute of frauds, summary
judgment affirmed)
ConocoPhillips proved as a matter of law there was no meeting of the minds necessary
to form a binding contract because it did not accept WTG’s offer Accordingly, we
sustain ConocoPhillips’s cross-point and uphold the summary judgment in its favor.
Because we have concluded there was no contract,
we agree that, as a matter of law, Targa is not liable for tortious interference.
AFFIRMED: Opinion by Justice Seymore     
Before Chief Justice Hedges, Justices Anderson and Seymore    
14-08-00019-CV  WTG Gas Processing, LP v. ConocoPhillips Company, Targa Field Services, LLC, Targa
Resources Texas GP LLC, Targa Resouces, Inc., Targa Texas Field Services, Lp and Warburg Pincus, LLC   
Appeal from 333rd District Court of Harris County
Trial Court Judge:
Joseph J. Halbach  In sum, ConocoPhillips proved as a matter of law there was no meeting
of the minds necessary to form a binding contract because it did not accept WTG’s offer Accordingly, we
sustain ConocoPhillips’s cross-point and uphold the summary judgment in its favor.

In The
Fourteenth Court of Appeals
_______________
NO. 14-08-00019-CV
_______________
WTG GAS PROCESSING, L.P., Appellant
V.
CONOCOPHILLIPS COMPANY, TARGA RESOURCES TEXAS GP LLC,
TARGA RESOURCES, INC., TARGA TEXAS FIELD SERVICES, LP, AND
WARBURG PINCUS, LLC, Appellees
On Appeal from the 333rd District Court
Harris County, Texas
Trial Court Cause No. 2005-77919

O P I N I O N

This suit arises from appellee, ConocoPhillips Company’s (“ConocoPhillips”), sale
of a natural-gas processing facility to appellees, Targa Resources Texas GP LLC, Targa
Resources, Inc., Targa Texas Field Services, LP, and Warburg Pincus, LLC (collectively
“Targa”),1 instead of appellant, WTG Gas Processing, L.P. (“WTG”). WTG sued
The summary-judgment motions, responses, 2 and record in this case are voluminous. We set forth
only the facts pertinent to our disposition which nonetheless are somewhat extensive.

1 The “Targa” entities bought the assets, and Warburg Pincus financed a portion of the purchase.
Because the same claims were asserted against these defendants, we refer to them collectively as “Targa.”
Affirmed and Opinion filed February 23, 2010.

2
ConocoPhillips for breach of contract, fraud, and negligent misrepresentation and Targa for
tortious interference with contract or prospective business relationship. The trial court
granted separate motions for summary judgment filed by ConocoPhillips and Targa and
signed a final judgment that WTG take nothing on all its claims.
In two issues, encompassing numerous sub-issues, WTG contends the trial court erred
by granting summary judgment on the breach-of-contract claim against ConocoPhillips and
the tortious-interference-with-contract claim against Targa. WTG challenges the grounds
on which the trial explicitly granted summary judgment. Both ConocoPhillips and Targa
present cross-points, contending the summary judgments should be upheld on alternative
grounds, which were denied by the trial court. As explained below, we agree with a crosspoint
raised by both ConocoPhillips and Targa, and, therefore, affirm the final judgment.

I. BACKGROUND 2

WTG is a limited partnership which owns midstream natural-gas gathering and
processing systems. In 2003, ConocoPhillips decided to sell several of its natural gas
processing plants and pipelines, including San Angelo Operating Unit (“SAOU”), Louisiana
Operating Unit (“LOU”), and Southeast New Mexico assets (“SENM”). ConocoPhillips
engaged Morgan Stanley & Co., Incorporated (“Morgan Stanley”) to conduct the sale.
Morgan Stanley issued a “Teaser,” inviting interested parties to potentially bid on an
individual asset or certain assets combined. After WTG signed a confidentiality agreement,
Morgan Stanley gave WTG a Confidential Information Memorandum (“CIM”), which
described the assets in more detail and outlined the progressive steps of the transaction
process: interested parties submit a non-binding Indication of Interest (“IOI”) containing
requisite items; Morgan Stanley and ConocoPhillips will evaluate the IOIs and invite a
3

limited number of bidders to attend a management presentation, participate in due diligence,
receive further information, including a draft Purchase and Sale Agreement (“PSA”), and
attend a site visit from which to submit bids; and upon evaluation of the final bids, Morgan
Stanley will narrow the number of bidders and enter into final PSA negotiations. The CIM
also provided in pertinent part:
Morgan Stanley and ConocoPhillips reserve the right to . . . negotiate with one
or more parties at any time and . . . enter into preliminary or definitive
agreements at anytime and without notice or consultation with any other
parties. Morgan Stanley and ConocoPhillips also reserve the right, in their sole
discretion, to reject any and all final bids without assigning reasons and to
terminate discussions and/or negotiations at any time for any reason or for no
reason at all.
After submitting an IOI for SAOU, WTG was invited to, and did, participate in the
next stage of the process. Then, on October 30, 2003, via letter, Morgan Stanley invited
WTG to submit a binding proposal and outlined the requirements for such a bid (“the bid
procedures”). The proposal was required to include ConocoPhillips’s draft PSA marked by
WTG to show its proposed changes. Among other provisions, the bid procedures contained
the following language:

! A Proposal will only be deemed to be accepted upon the execution and
delivery by ConocoPhillips of a [PSA(s)].
! [ConocoPhillips] expressly reserves the right, in its sole discretion and
at any time and for any reason, to exclude any party from the process
or to enter into negotiations or a [PSA(s)] with any prospective
purchaser or any other party . . . and to reject any and all Proposals for
any reason whatsoever . . . . [ConocoPhillips] also expressly reserves
the right to negotiate at any time with any prospective purchaser
individually or simultaneously with other prospective purchasers . . . .
None of ConocoPhillips, its affiliates, representatives, related parties or
Morgan Stanley will have any liability to any prospective purchaser as
a result of the rejection of any Proposal or the acceptance of another
Proposal at any time.
4

! Until the [PSA(s)] for this transaction is executed by ConocoPhillips
and a purchaser, [ConocoPhillips], its affiliates and related parties shall
not have any obligations to any party with respect to the contemplated
transaction, and following such execution and delivery, the only
obligations of ConocoPhillips, its affiliates and related parties will be
to the other party to the [PSA(s)], and only as set forth therein.

By letter dated November 19, 2003, WTG submitted a “final binding bid” of $135.4
million for SAOU “[i]n accordance with the [CIM] . . . and the [bid procedures].” WTG
subsequently increased its bid to $145.4 million after being informed that its offer was lower
than others under consideration but ConocoPhillips was more comfortable with WTG
because of fewer changes needed to its PSA and the parties’ past relationship. WTG was
then informed by Morgan Stanley that it likely would be the winning bidder if it increased
its bid to $148.4 million to make it comparable to another offer ConocoPhillips was
considering. On December 10, 2003, WTG increased its bid to $148.4 million.
According to the deposition testimony of Dave Freeman (WTG’s employee who was
its principle contact for the transaction), on December 11, 2003, Garrett Rychlik
(ConocoPhillips’s Coordinator of Business Development responsible for managing the
auction of SAOU), Robert Friedsam (Morgan Stanley), and Ryan Engle (Morgan Stanley),
telephoned Freeman stating the following: ConocoPhillips had decided to “go forward with”
WTG; ConocoPhillips and WTG had a “deal,” ConocoPhillips had some “immaterial”
changes—“wording” issues—to WTG’s draft PSA; the parties would “proceed to get it
signed”; and ConocoPhillips would forward a revised version the next day or at least by
December 15.
At that point, WTG’s draft PSA was not in executable form and did not, among other
omissions, fully describe the assets to be purchased or include all exhibits. WTG and
ConocoPhillips did not thereafter engage in any negotiations relative to a PSA,
ConocoPhillips made no counter proposal, and these parties never executed a PSA.
5

Meanwhile, in November and early December of 2003, Targa had submitted bids for
multiple assets, including SAOU, and expressed a strong preference to make a group
purchase. On December 10, Targa resubmitted a bid of $335 million for SAOU, SENM, and
LOU combined and reiterated its interest in acquiring several assets in a single transaction.
However, as of December 11, ConocoPhillips had decided to pursue PSA negotiations
with WTG for SAOU, Targa for LOU only, and another entity for SENM. During the days
immediately following the December 11th phone conversation with WTG, several
ConocoPhillips employees who were responsible for various aspects of the sale generated
some internal e-mails. The e-mails reflected that, although Targa’s single bid was higher
than the total separate offers, ConocoPhillips viewed the separate sales as more optimal than
a package sale to Targa. The employees discussed the status of the sale in light of this
decision. Specifically, on December 12, Will Duey wrote William Earnest and Mary Pearce:
[W]e are moving forward with due diligence and PSA negotiations with DEFS
for SENM, [WTG] for [SAOU] and [Targa] for LOU. It is our goal to have
PSAs for SENM and [SAOU] mid-January and close both before the end of
February. These dates are subject to both due diligence and HSR requirements;
however, they seem achievable at this point in time. Because of [Targa’s]
requirements LOU is expected to close later . . . .
. . . .
Morgan Stanley is notifying the unsuccessful bidders that we are starting down
the road with other parties.
About two hours later, William Earnest forwarded the message to John Lowe (a
ConocoPhillips vice-president) stating:
fyi - We are going down the path of 3 sales vs. one transaction with Targa due
to closing concerns (new entity), due diligence requirements and [PSA]
markup by Targa. We have done deals with [WTG] and DEFS before and are
more confident of closing with them. . . .
6

Later that day, Mary Pearce wrote to Sigmund Cornelius and William Earnest, warning of
a potential “political problem” due to Targa’s latest bid:
We had already released DEFS and WTG to start due diligence on SENM and
[SAOU], respectively. We also believe that there is a high risk that Targa will
whittle the price down and WTG will not and DEFS may not based on our past
dealings. When we advised Targa that we would not stop the due diligence and
give them an exclusive on the 3 properties, they become [sic] upset and
threatened to not buy LOU. We do plan to tell them that we want to work with
them on LOU and will give them the opportunity if the negotiations fall apart
with our primaries. If they do not buy LOU - we have other options.
We wanted you to know as you may hear complaints from Targa. We are
committed to obtain the best value as well as live with our deals.
On December 15, Will Duey e-mailed John Lowe, expressing:
[Targa] seem[s] to be fishing for a magic number rather than raising their bid
or modifying the PSA that they marked up. It seems late to ask them to submit
a new PSA as we have already started due diligence with DEFS and [WTG].
Certainly Targa is a great option if those deals fall apart.
Then, on December 15, Targa did submit another bid of $255 million for SAOU and
LOU combined, recognizing a package purchase which also included SENM may “no longer
be an option.” Targa also made some concessions on terms and guaranteed flexibility
relative to negotiating other terms in light of ongoing discussions with Morgan Stanley which
clarified ConocoPhillips’s “key considerations.” Morgan Stanley forwarded this proposal
to ConocoPhillips, noting it was a total premium of $22 million over the existing offers.
ConocoPhillips indicated to Morgan Stanley that this offer had potential if the parties could
negotiate other details. On December 19, Morgan Stanley informed Freeman that
ConocoPhillips was considering another offer.
On December 22, Freeman e-mailed Rychlik (ConocoPhillips) inquiring about the
status of the PSA in light of the December 11th phone conversation and offering a meeting
between the parties’ attorneys to discuss the PSA. Freeman stated WTG was anxious to
7

conclude this transaction because it was in the process of purchasing another interdependent
facility in the area. He also stated that WTG had completed some aspects of due diligence
and requested permission to conduct further due diligence during the first week of January.
On the same day, Engle (Morgan Stanley) responded to Freeman’s e-mail, confirming
WTG could conduct the requested due diligence. Engle advised that ConocoPhillips’s
attorney for the sale process was on vacation for the remainder of December and could not
devote significant time to the PSA that week, and “[a]s previously mentioned, we believe the
two parties are close enough on the PSA that finalizing that document can be done in an
expedious [sic] fashion (most likely during the week of Jan. 5).” Also that day, Rychlik
confirmed to Freeman that ConocoPhillips was considering another offer, which included
SAOU, and a decision about the new bid would not likely be made before January. Rychlik
stated he was not “playing games” with WTG but ConocoPhillips had to consider the other
offer. Freeman replied that WTG would be “extremely upset” if a transaction between WTG
and ConocoPhillips were not consummated because it had offered a “premium” for SAOU
and the complementary facility and would be “very upset” if ConocoPhillips took the other
offer without giving WTG an opportunity to adjust its bid although it might not do so. The
next day, Freeman expressed to Morgan Stanley and Rychlik via e-mail that allowing WTG
to continue a brisk pace on due diligence would enable it to sign a PSA “as soon as the
attorneys have negotiated the agreement.”
Throughout late December 2003 and January and February of 2004, ConocoPhillips
negotiated with Targa. During this period, WTG, ConocoPhillips, and Morgan Stanley
continued to communicate, in writing or orally, regarding the status of the sale. WTG
periodically apprised Morgan Stanley and ConocoPhillips regarding the status of WTG’s due
diligence efforts, and they kept WTG informed that ConocoPhillips was still evaluating the
other offer.
8
At one point in early January, Freeman again asked if WTG would be given the
opportunity to revise its bid before ConocoPhillips accepted the other offer. Morgan Stanley
replied that ConocoPhillips would likely proceed with the other party if its bid were the best
offer but WTG was free to submit a revised bid before that time. J.L. Davis, owner of WTG,
subsequently wrote two letters to Morgan Stanley stating WTG would not increase its offer
because it believed the parties had an “agreement” on price, the offer was fair, and WTG had
expended considerable resources and made another commitment based on advice it had been
selected to purchase SAOU; expressing “keen disappointment” if the sale were not
concluded; and reiterating WTG’s “expectation that ConocoPhillips will honor its
commitment to accept our bid.”
Morgan Stanley then notified WTG that due diligence should be conducted at its own
risk and reminded WTG the bid materials advised that ConocoPhillips could negotiate with
any party until a PSA was signed. A few days later, Freeman informed ConocoPhillips and
Morgan Stanley that once certain aspects of due diligence were complete, it would be
prepared to “finalize and sign” a PSA. Subsequently, Morgan Stanley advised Freeman that
negotiations with the other party were down to the “critical stage” but ConocoPhillips wanted
to keep communications open with WTG as a “good alternative.” Morgan Stanley inquired
about WTG’s status should ConocoPhillips decide to proceed with WTG. Freeman replied
that WTG was “basically down to finalizing the PSA and verifying volumes.”
On February 28, 2004, ConocoPhillips and Targa executed PSAs for SAOU and LOU.
A few days later, Morgan Stanley informed Freeman that ConocoPhillips had now executed
a “definitive agreement.” The closing for the transaction with Targa occurred in April 2004.
In December 2005, WTG sued ConocoPhillips for breach of contract, fraud, and
negligent misrepresentation and Targa for tortious interference with contract or prospective
business relationship. ConocoPhillips and Targa each filed a traditional motion for summary
judgment followed by a supplement to the motion. On October 2, 2007, the trial court signed
WTG also sued Morgan S 3 tanley, and the trial court granted summary judgment in its favor, which
WTG does not challenge on appeal.
4 WTG does not challenge summary judgment on its fraud and negligent-misrepresentation claims.
9

a “Memorandum Opinion and Order” granting both motions for summary judgment and
explaining at length the reasons for its decision. On October 4, 2007, the trial court signed
a final judgment referencing its previous order and ruling that WTG take nothing on all its
claims. WTG appeals the summary judgment in favor of both ConocoPhillips and Targa.3

II. STANDARD OF REVIEW

A party moving for traditional summary judgment must establish there is no genuine
issue of material fact and it is entitled to judgment as a matter of law. See Tex. R. Civ. P.
166a(c); Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215–16 (Tex. 2003).
A defendant moving for summary judgment must conclusively negate at least one element
of the plaintiff’s theory of recovery or plead and conclusively establish each element of an
affirmative defense. Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex. 1995). If the
defendant establishes its right to summary judgment, the burden shifts to the plaintiff to raise
a genuine issue of material fact. Id. We review a summary judgment de novo. Knott, 128
S.W.3d at 215. We take as true all evidence favorable to the nonmovant and indulge every
reasonable inference and resolve any doubts in favor of the nonmovant. Id.

III. CONOCOPHILLIPS’S MOTION FOR SUMMARY JUDGMENT

In its first issue, WTG contends the trial court erred by granting summary judgment
in favor of ConocoPhillips on WTG’s breach-of-contract claim.4

A. The Issues

ConocoPhillips moved for summary judgment on two alternative grounds: (1) WTG
cannot prove existence of a valid contract because the evidence conclusively established
See Tex. Bus. & Com. 5 Code Ann. § 26.01(a), (b)(4) (Vernon 2009) (providing that a promise or
agreement for the sale of real property “is not enforceable unless the promise or agreement, or a
memorandum of it, is (1) in writing; and (2) signed by the person to be charged with the promise or
agreement or by someone lawfully authorized to sign for him.”).
6 See Nagle v. Nagle, 633 S.W.2d 796, 800 (Tex. 1982) (recognizing courts will enforce oral
promise to sign instrument complying with statute of frauds if (1) promisor should have expected his promise
would lead promisee to some definite and substantial injury, (2) such injury occurred, and (3) the must
enforce promise to avoid injustice).
7 Although we need not address the statute-of-frauds issue, in essence, WTG maintains (1) a contract
was memorialized in writing through ConocoPhillips’s internal e-mails after the December 11th phone
conversation, together with WTG’s PSA and other documents relative to the bid process; or (2) alternatively,
10

there was no meeting of the minds; and (2) the statute of frauds bars WTG’s claim.5 In its
responses, WTG addressed these grounds and also raised a promissory-estoppel defense to
the statute-of-frauds contention.6
In its order, the trial court found a genuine issue of material fact on whether a contract
was formed. However, the trial court concluded that an enforceable contract did not exist
as a matter of law because there was no writing satisfying the statute of frauds and WTG
failed to present evidence supporting its promissory-estoppel argument.

On appeal, WTG challenges both conclusions concerning the statute of frauds. In
addition to arguing that the trial court correctly concluded the statute of frauds was not
satisfied, ConocoPhillips raises two cross-points. In one such cross-point, ConocoPhillips
challenges the trial court’s ruling that there was a genuine issue of material fact on whether
a contract was formed.

As discussed below, we agree that, as a matter of law, ConocoPhillips negated
formation of a contract. Therefore, we need not address the statute-of-frauds issue and will
uphold the summary judgment based on ConocoPhillips’s cross-point. See Cincinnati Life
Ins. Co. v. Cates, 927 S.W.2d 623, 625–26 (Tex. 1996) (holding appellate court, when
reviewing summary judgment, should consider all grounds on which the trial court ruled and
the movant preserved for appellate review that are necessary for final disposition of appeal).7
ConocoPhillips was estopped to raise the statute of frauds because WTG relied on ConocoPhillips’s promise
to sign a PSA when purchasing the complementary facility, missing an opportunity to buy another property,
and expending funds on due diligence for SAOU. The trial court concluded that the December 12th e-mail
from Mary Pearce to other ConocoPhillips employees included the material terms of an oral contract, if any,
either in the e-mail or through incorporation of other documents, and was signed electronically; however,
the e-mail did not include sufficient language of assent to show an agreement between the parties. The trial
court also rejected the promissory-estoppel argument because (1) there was no evidence of a promise to sign
a prepared, written agreement that would satisfy the statute of frauds, see 1001 McKinney Ltd. v. Credit
Suisse First Boston Mortg. Capital, 192 S.W.3d 20, 29 (Tex. App.—Houston [14th Dist.] 2005, pet. denied);
(2) WTG acquired the complementary facility, forfeited the other purchase opportunity, and pursued due
diligence on SAOU after learning ConocoPhillips was considering another offer; and (3) evidence indicated
WTG would have acquired the complementary facility regardless of whether it purchased SAOU.
11

B. Analysis

To prevail on a breach-of-contract claim, a plaintiff must prove (1) a valid contract
existed between the plaintiff and the defendant, (2) the plaintiff tendered performance or was
excused from doing so, (3) the defendant breached the terms of the contract, and (4) the
plaintiff sustained damages as a result of the defendant’s breach.
West v. Triple B Servs.,
LLP, 264 S.W.3d 440, 446 (Tex. App.—Houston [14th Dist] 2008, no pet.). In its motion
for summary judgment, ConocoPhillips asserted the evidence conclusively negated the
existence of a valid contract because the parties did not have a meeting of the minds; i.e.
offer and acceptance.

Among other elements, a party must prove offer and acceptance to demonstrate
existence of a valid contract. DeClaire v. G & B Mcintosh Family Ltd. P’ship, 260 S.W.3d
34, 44 (Tex. App.—Houston [1st Dist.] 2008, no pet.); Wal-Mart Stores, Inc. v. Lopez, 93
S.W.3d 548, 555–56 (Tex. App.—Houston [14th Dist.] 2002, no pet.). A “meeting of the
minds” is “merely a mutuality subpart of the offer and acceptance elements.” Domingo v.
Mitchell, 257 S.W.3d 34, 40 (Tex. App.—Amarillo 2008, pet. denied). Although whether
the parties intended to be bound is often a question of fact, it may be determined as a matter
of law. See Foreca, S.A. v. GRD Devel. Co., 758 S.W.2d 744, 746 (Tex. 1988); John Wood
Group USA, Inc. v. ICO, Inc., 26 S.W.3d 12, 16 (Tex. App.—Houston [1st Dist.] 2000, pet.
8 ConocoPhillips seemed to dispute WTG’s version of the phone conversation. In his deposition,
Freeman added details, including ConocoPhillips’s alleged reference to a “deal” and “immaterial” PSA
changes, that had not been included in WTG’s interrogatory response describing the conversation.
ConocoPhillips also disputed that any proposed changes were “immaterial.” The other evidence relative to
our contract-formation analysis is undisputed because it consists of the documents relative to the bid process
and the parties’ documented or undisputed communications before and after the phone conversation.
Consistent with our standard of review, we will treat WTG’s version of the phone conversation as correct
solely for summary-judgment purposes because, as explained below, we nevertheless conclude there was no
fact issue regarding contract formation.
9 Although these provisions mention “execution and delivery” of a PSA, for ease of reference, we
will refer to these steps collectively as “execution” of a PSA.
12
denied); see also COC Servs., Ltd. v. CompUSA, Inc., 150 S.W.3d 654, 662–70 (Tex.
App.—Dallas 2004, pet. denied).
Although a PSA was never executed, WTG contends ConocoPhillips accepted WTG’s
offer during the December 11th phone conversation by representing that ConocoPhillips had
decided to “go forward with” WTG, they had a “deal,” ConocoPhillips had “immaterial”
changes to WTG’s PSA, and “the parties would “proceed to get it signed.”8
Based on the following provisions in the bid procedures, ConocoPhillips argues that
these oral representations, if any, did not constitute acceptance of WTG’s offer:
A Proposal will only be deemed to be accepted upon the execution and
delivery by ConocoPhillips of a [PSA].
Until the [PSA(s)] for this transaction is executed by ConocoPhillips and a
purchaser, [ConocoPhillips] . . . shall not have any obligations to any party
with respect to the contemplated transaction, and following such execution and
delivery, the only obligations of ConocoPhillips . . . will be to the other party
to the [PSA(s)], and only as set forth therein.9
In contrast, for two reasons, WTG contends these provisions did not conclusively
negate acceptance of its offer: (1) the fact that the parties contemplated later execution of a
PSA did not necessarily preclude their informal agreement from constituting a binding
contract; and (2) a fact issue existed on whether ConocoPhillips modified or waived these
13
provisions. The trial court seemed to conclude the above-cited provisions might otherwise
have negated that ConocoPhillips orally accepted WTG’s offer, but a fact issue existed on
whether ConocoPhillips waived these procedures.

1. Bid Procedures Precluding Acceptance Absent Execution of a PSA

ConocoPhillips cites several cases to support its contention that the above-cited bid
procedures negated any purported acceptance of WTG’s offer, including John Wood Group
and COC Services.
In John Wood Group, after negotiating the potential sale of certain assets, the parties
signed a letter of intent containing the following provision:
15. Binding Effect. This Letter Agreement constitutes a summary of the
principal terms and conditions of the understanding which has been reached
regarding the sale of certain assets to Purchaser . . . . It does not address all
of the terms and conditions which the parties must agree upon to become
binding and consummated. The Purchaser, however, does intend to move
forward with its due diligence and expects to expend considerable sums to
review the Sellers’ Business. In consideration therefor, the parties have agreed
to make certain covenants of this letter binding upon the parties
notwithstanding the fact that not all details of the transactions have been
agreed upon. Accordingly, it is understood and agreed that this letter is an
expression of the parties’ mutual intent and is not binding upon them except
for the provisions of [several numbered paragraphs].
26 S.W.3d at 15 (emphasis added in original opinion). The seller refused to consummate the
transaction because of disputes on certain matters and sold the assets to another company.
Id. In the prospective buyer’s subsequent suit, a jury found that the seller breached the letter
agreement. Id. at 16. The court of appeals held this issue was improperly submitted to a jury
and there was no contract as a matter of law because the parties unambiguously expressed
their intent not to be bound by the letter agreement except for certain paragraphs. See id. at
16–20.
14

In COC Services, the parties signed a letter of intent with a form master franchise
agreement attached. 150 S.W.3d at 660. The letter provided that, if the master franchise
agreement were not signed by a certain date, the letter “will expire, and neither of the
undersigned shall have any further obligation or liability hereunder with respect to a
potential master franchise or license for the development and operation of the Stores. . . . ”
Id. at 663 (emphasis added in original opinion). Relying primarily on this language, the court
held that, as a matter of law, the parties did not intend to be bound by the master franchise
agreement which was never completed and executed. See id. at 665–70.
WTG cites several cases to support its position that the fact the parties contemplated
later execution of a written agreement did not necessarily preclude their informal agreement
from constituting a binding contract. For example, in Foreca, the parties initialed a
handwritten document which included several terms concerning the sale of amusement-park
rides and the language, “SUBJECT TO LEGAL DOCUMENTATION CONTRACT TO BE
DRAFTED BY [SELLER’S ATTORNEY].” 758 S.W.2d at 744–45. Subsequently, the
seller sued the prospective buyer for breach of contract after it refused to purchase the rides.
Id. at 745. Relying on the above-quoted language, the buyer urged that no enforceable
agreement was made. Id. The Texas Supreme Court held this language was not conclusive
on intent to contract because a fact question existed on whether the contemplated formal
writing was a condition precedent to contract formation or merely a memorial of an already
enforceable contract. Id. at 745–46.
WTG also relies on Murphy v. Seabarge, Ltd., 868 S.W.2d 929, 933 (Tex.
App.—Houston [14th Dist] 1994, writ denied), in which a “Memorandum of Understanding”
between partners provided it was “not intended to be a binding contract” but an outline of
proposals in the event the partnership filed bankruptcy and thus was subject to “preparation
of appropriate documentation” and approval of the bankruptcy court. When the partnership
sued one partner for taking management fees beyond those authorized by the memorandum,
15

he relied on the foregoing provision to argue the memorandum was not an enforceable
contract. Id. at 932–33. The court held that a fact issue existed on whether the parties
intended to be bound by the memorandum. Id. at 933–34.
The Foreca and Murphy courts recited, and WTG also relies on, the following wellestablished
general contract principles: (1) the fact that parties to an informal agreement
contemplate a formal writing does not necessarily prevent formation of a binding contract
even if the formal writing is never drafted and executed; see Scott v. Ingle Brothers Pacific,
Inc., 489 S.W.2d 554, 556 (Tex. 1972) (citing 17 Am. Jur. 2d, Contracts § 28); and (2)
parties may form a binding contract if they agree on material terms although they leave other
terms open for later negotiation; see id. (quoting 1 Arthur Corbin, Corbin on Contracts § 28,
at 93–95 (1963)); see also Foreca, 758 S.W.2d at 746 (citing Scott, 489 S.W.2d at 556);
Murphy, 868 S.W.2d at 933 (citing Scott, 489 S.W.2d at 556).

We conclude that John Wood Group and COC Services are persuasive in the present
case and Foreca and Murphy, as well as the general contract principles recited therein, are
distinguishable. The ConocoPhillips bid procedures were much more definitive than the
“subject to legal documentation” language in Foreca. Instead, like the pertinent provisions
in John Wood Group and COC Services, the bid procedures unequivocally provided that
ConocoPhillips did not intend to accept an offer, or bear any contractual obligations to
another party, absent execution of a PSA. Thus, execution of a PSA was clearly a condition
precedent to contract formation and not merely a memorialization of an existing contract.
See John Wood Group, 26 S.W.3d at 16–19 (stating the “is not binding” language in the John
Wood Group letter of intent was more definitive than the language in Foreca and compelled
only the conclusion that the parties did not intend to be bound).
The language disavowing intent to be bound in Murphy was more emphatic than the
pertinent language in Foreca. See Murphy, 868 S.W.2d at 933. Nevertheless, the evidence
raising a fact issue was the partner’s admitted partial performance of the agreement despite
16

his later attempt to disavow an enforceable contract. Id. at 932–34; see John Wood Group,
26 S.W.3d at 17 (distinguishing Murphy because its party’s partial performance after
agreement was signed created fact question on intent to be bound despite “no intent”
provision whereas no such partial performance occurred in John Wood Group). In the
present case, the parties did not engage in partial performance; indeed, this dispute arose
because ConocoPhillips sold the facility to another party.
In fact, the John Wood Group court acknowledged the general principles recited in
Foreca, Murphy, and Scott when cautioning that a party may risk being contractually bound
by a letter of intent which includes essential terms although it does not contain all protections
for which the parties would ordinarily negotiate or on which due diligence is incomplete. See
John Wood Group, 26 S.W.3d at 19–20. “Therefore, a party who does not wish to be
prematurely bound by a letter agreement should include ‘a provision clearly stating that the
letter is nonbinding, as such negations of liability have been held to be effective.’” Id. at 19
(quoting E. Allan Farnsworth, Farnsworth On Contracts § 3.8b, at 193 (1990)). The court
stated that the case did not merely involve missing unessential terms, but whether there was
mutual consent on essential terms. Id. at 20. Although the parties may have reached a
preliminary agreement on essential terms—the item to be sold and the price—the seller
withheld its consent to be bound on those agreed-upon terms until a final purchase agreement
was signed. Id. Similarly, ConocoPhillips withheld its acceptance of an offer until execution
of a PSA, despite any preliminary “deal” on essential terms made during the December 11th
phone conversation.
We acknowledge that the present case differs from John Wood Group and COC
Services in that the provisions reflecting intent not to be bound in those cases were contained
in a written agreement signed by both parties. See John Wood Group, 26 S.W.3d at 15; COC
Servs., 150 S.W.3d at 663. In this case, the language precluding acceptance of an offer
absent execution of a PSA was contained within the bid procedures promulgated by
17

ConocoPhillips. Nonetheless, WTG made its bid “[i]n accordance with the [CIM] . . . and
the [bid procedures].” WTG argued this language did not necessarily mean it agreed to the
bid procedures, but merely that it was responding to the procedures by submitting all items
required therein. Although the trial court ultimately agreed with WTG on the contractformation
dispute, it disagreed with this point, stating “it appears the procedures were
incorporated into WTG’s offer. . . .”

We agree that, under the plain meaning of “[i]n accordance with,” WTG submitted
its offer subject to the bid procedures. See WEBSTER’S THIRD NEW INT’L DICTIONARY 12
(1993) (defining “accordance” to mean “Agreement, Accord”); BLACK’S LAW DICTIONARY
18 (8th ed. 2004) (defining “accordant” to mean “In agreement”). Nevertheless, by
acknowledging the bid procedures, WTG knew that ConocoPhillips, at least, had no intent
to be bound absent execution of a PSA. See RESTATEMENT (SECOND) OF CONTRACTS § 27
cmt. B (1981) (“[I]f either party knows or has reason to know that the other party regards the
agreement as incomplete and intends that no obligation shall exist until other terms are
assented to or until the whole has been reduced to another written form, the preliminary
negotiations and agreements do not constitute a contract.”); see also RHS Interests, Inc. v.
2727 Kirby Ltd., 994 S.W.2d 895, 897–99 (Tex. App.—Houston [1st. Dist.] 1999, no pet.)
(holding there was no contract for purchase of property where buyer stated its written offer
was “not binding as an agreement unless and until a fully executed Earnest Money contract
is signed,” but even under buyer’s position that subsequent oral negotiations replaced this
offer, no contract was formed because seller’s response indicated “deal” would be
consummated only by “execution of the binding Purchase and Sale Agreement.”).

2. Modification or Waiver of Bid Procedures

Next, WTG contends, and the trial court agreed, that the language at issue in the bid
procedures did not conclusively negate acceptance of WTG’s offer because a genuine issue
Despite ConocoPhillips’s disagreement, the trial court 10 suggested that this general principle
regarding oral modification of an existing contract was applicable to a question of contract formation. See
W. Hatcheries v. Byrd, 218 S.W.2d 342, 343 (Tex. Civ. App.—Dallas 1949, no writ) (“Power to modify a
pre-existing contract is coextensive with the power to initiate it . . . .” (quoting 10 Tex. Jur. § 203)).
ConocoPhillips also notes the full holding of Mar-Lan Industries referred to oral modification of “a written
contract not required by law to be in writing.” 635 S.W.2d at 855 (emphasis added). We need not decide
the extent to which a written contract may be modified by oral agreement or whether principles regarding
contract modification are applicable here because there is no fact issue on whether ConocoPhillips waived
the bid procedures.
18

of material fact existed on whether ConocoPhillips modified or waived the procedures. In
support, WTG and the trial court cited another provision in the bid procedures:
ConocoPhillips reserves the right, without explanation, to amend, modify or
waive the procedures, terms and conditions set forth herein at any time, with
or without sending notice of the waivers or changes to prospective purchasers.
Additionally, WTG argued, and the trial court stated, “Texas jurisprudence allows parties to
orally modify a contract even if the contract itself contains language prohibiting oral
modification, if parties agree to disregard this language.” See Morrison v. Ins. Co. of N. Am.,
69 Tex. 353, 364, 6 S.W. 605, 609 (Tex. 1887); Mar-Lan Indus., Inc. v. Nelson, 635 S.W.2d
853, 855 (Tex. App.—El Paso 1982, no writ).”10
Relying on the above-cited provision and the general principle regarding contract
modification, the trial court concluded:
It is possible ConocoPhillips had the requisite intent to form a contract without
the added protection of the bid procedures and, that though the parties still
intended to execute a final agreement, ConocoPhillips forwent such as a
requirement and accepted on the spot, thus waiving the condition precedent by
its acceptance. Though the proposition that ConocoPhillips did so may seem
dubious, this is a matter for the finder of fact to determine. Whether intent was
present, acceptance given, and oral agreement made are matters best left to a
finder of fact. The Court finds that the bid procedures promulgated by
ConocoPhillips did not limit ConocoPhillips’ ability to accept WTG’s PSA as
it was and at that time for the purposes of summary judgment.
Garrett Rychlik, ConocoPhillips’s representative who actually 11 participated in the December 11th
phone conversation and was deposed as ConocoPhillips’s corporate representative, expressly testified it did
not “change those procedures.” However, in a letter filed before the summary-judgment hearing regarding
the parties’ agreements relative to evidentiary objections, ConocoPhillips’s counsel wrote, “Defendants are
willing to limit their reliance on depositions attached as exhibits to their briefs to the specific pages of those
exhibits cited within those briefs.” Rychlik’s entire deposition was attached to ConocoPhillips’s motion for
summary judgment, but the above excerpt was not cited in ConocoPhillips’s summary-judgment filings. We
note the trial court did not specifically strike all deposition testimony that was not cited in the parties’ briefs.
Nonetheless, even if we disregard the above excerpt, WTG failed to present any evidence that
ConocoPhillips expressly decided to waive the bid procedures.
19

WTG also cites authority recognizing a party may waive a condition it originally
imposed as prerequisite to contract formation, although the trial court did not recite this
principle in its order. See, e.g., Padilla v. LaFrance, 907 S.W.2d 454, 460–61 (Tex. 1995)
(recognizing offer prescribing time and manner of acceptance must ordinarily be complied
with to create contract, but different method of acceptance may be effectual where offeror
agrees to modification of terms of acceptance).
Waiver is “an intentional relinquishment of a known right or intentional conduct
inconsistent with claiming that right.” Jernigan v. Langley, 111 S.W.3d 153, 156 (Tex.
2003) (per curiam). Initially, Freeman acknowledged in his deposition that ConocoPhillips
never expressed to WTG it had waived the bid procedures that precluded acceptance of an
offer absent execution of a PSA. Nonetheless, the fact that ConocoPhillips did not
communicate any express waiver to WTG is inconclusive because ConocoPhillips reserved
the right to unilaterally waive the procedures without informing WTG. However, WTG also
cites no evidence indicating ConocoPhillips made any express, internal decision to waive
these procedures.11 Therefore, the gist of WTG’s argument, and the trial court’s reasoning,
was that a jury might decide the oral representations during the December 11th phone
conversation themselves constituted ConocoPhillips’s waiver of these bid procedures.
Consequently, we construe the issue as whether ConocoPhillips waived the bid
procedures through its conduct; i.e. representations which did not expressly relinquish its
20

rights. For implied waiver to be found through a party’s conduct, intent must be clearly
demonstrated by the surrounding facts and circumstances. Id.; see Van Indep. Sch. Dist. v.
McCarty, 165 S.W.3d 351, 353 (Tex. 2005) (“[T]hat conduct must be unequivocally
inconsistent with claiming a known right.”). “There can be no waiver of a right if the person
sought to be charged with waiver says or does nothing inconsistent with an intent to rely
upon such right.” Jernigan, 111 S.W.3d at 156. Waiver is ordinarily a question of fact, but
when the surrounding facts and circumstances are undisputed, the question becomes one of
law. Id. at 156–57. Considering the surrounding facts and circumstances, including the
purpose of the bid process and procedures and ConocoPhillips’s actions after the phone
conversation, we conclude the oral representations were insufficient as a matter of law to
constitute waiver of the bid procedures at issue.

a. The purpose of the bid process and procedures

First, allowing a jury to decide the oral representations alone constituted waiver
would vitiate the purpose of the overall bid process and the procedures. The bid procedures
provided that one of ConocoPhillips’s “key objectives” was “to obtain the highest possible
value” and it would evaluate proposals “with the goal of negotiating and executing a
[PSA(s)] with the party that submits the Proposal which best meets [ConocoPhillips’s]
objectives.” ConocoPhillips’s internal e-mails reflect that the “highest possible value”
involved considerations of purchase price and contract terms.
Both the CIM and the bid procedures demonstrate they were intended to ensure that
ConocoPhillips achieved its objectives by prescribing an aggressive, competitive bidding
process. ConocoPhillips reserved the right to pursue the most favorable bid until execution
of a PSA by specifying it could entertain a bid at any time, negotiate with any prospective
purchaser at any time, and negotiate with multiple parties at the same time.
12 ConocoPhillips did not sign a PSA with WTG because it received a better offer—not because the
parties failed to agree on additional terms. Nonetheless, ConocoPhillips reserved the right to condition its
acceptance on an executed PSA regardless of the reason it might never be executed. Further, as the trial
court suggested relative to the statute-of-frauds analysis, despite ConocoPhillips’s purported representations
to Freeman on December 11 that its revisions to WTG’s PSA were immaterial, it is unknown whether they
truly would have been immaterial once negotiated. As the trial court further recognized, if WTG were
unwilling to sign an agreement incorporating ConocoPhillips’s revisions, WTG would likely have been the
party claiming ConocoPhillips never accepted WTG’s offer.
21

Additionally, arriving at the final terms of a complex, commercial transaction involves
extensive time, effort, research, and finances. See John Wood Group, 26 S.W.3d at 19.
Further, it is axiomatic that parties to a complex transaction may need to reach a preliminary
agreement in order to proceed toward execution of a final agreement. Consequently, parties
may structure their negotiations so that they preliminarily agree on certain terms, yet protect
themselves from being prematurely bound in the event they disagree on other terms. See id.
(discussing purpose of a letter of intent). Indeed, the CIM reflected that ConocoPhillips
viewed a preliminary agreement as different from a PSA because it reserved the right to
“enter into preliminary or definitive agreements at any time.” Thus, entering into a
preliminary “deal” was not necessarily inconsistent with requiring an executed PSA to form
a binding contract.12
Accordingly, the bid procedures at issue were intended in part to protect
ConocoPhillips in a situation such as the present dispute; i.e. prevent an informal, preliminary
agreement with a prospective purchaser from forming a binding contract before execution
of the formal writing. Consequently, we employ an opposite reasoning to that urged by WTG
and adopted by the trial court: in short, the representations during the December 11th phone
conversation cannot alone constitute waiver of the bid procedures and acceptance of WTG’s
offer when the bid procedures were implemented partly to prevent such representations from
constituting acceptance of an offer.
Again, we find COC Services, as well as a federal case cited therein, are illustrative.
In COC Services, the plaintiff buyer argued that the following conduct by the seller after
22

signing the letter of intent indicated the parties had entered into a contract although no master
franchise agreement was ever signed: the seller sent potential licensees materials indicating
the master franchise agreement was already binding; the seller acquiesced in materials the
buyer prepared for potential licensees stating that it “currently owns” a franchise; and the
seller’s representative stated in a meeting that the partners of the buyer were “owners of right
for the franchise.” COC Servs., 150 S.W.3d at 669. The court held that the seller’s conduct
did not eclipse the other factors showing lack of intent to be bound absent execution of a
master franchise agreement. Id. at 669–70.
The COC Services court cited Arcadian Phosphates, Inc. v. Arcadian Corp., 884 F.2d
69, 72–3 (2nd Cir. 1989), in which the court concluded that the parties to a memorandum
“agreement” concerning the sale of certain assets did not intend to be bound until execution
of a formal agreement. The court reached this conclusion although the seller, who ultimately
refused to consummate the transaction and disavowed existence of a binding contract,
engaged in the following conduct after signing the memorandum agreement: obtained its
board’s approval of the “proposed agreement”; informed third-parties of an “agreed-upon”
sale with a “signed agreement”; referred to the buyer as the “new owner”; took various steps
to consummate the transaction; and referred to on-going “final” negotiations with an absolute
closing date. See id. at 71.
We recognize the COC Services and Arcadian courts did not use the term “waiver.”
See generally COC Servs., 150 S.W.3d 654; Arcadian, 884 F.2d. 69. Nevertheless, their
discussions were similar to a waiver analysis because the courts refused to disregard the
parties’ expression of no intent to be bound by a preliminary agreement despite one party’s
subsequent conduct which might otherwise have shown acknowledgment of a binding
contract. See COC Servs., 150 S.W.3d at 669–70; Arcadian, 884 F.2d at 71–77. Likewise,
We do not n 13 ecessarily agree that the language in the Arcadian memorandum agreement negating
contract formation would do so under Texas law. Regardless, we do not cite Arcadian relative to the
language sufficient to negate intent to be bound absent a final agreement. Rather, we cite Arcadian for the
proposition that the seller’s conduct after signing the memorandum agreement was insufficient to override
language that at least the Arcadian court considered sufficient to negate intent to be bound.
14 Relative to the statute-of-frauds issue, the trial court concluded “We are committed to . . . live
with our deals” did not clearly mean an agreement with WTG, as opposed to some other agreement or general
“sentiment.” We will assume solely for purposes of the contract-formation issue that this statement referred
to a preliminary agreement with WTG because it nonetheless did not raise a fact issue on waiver.
23

ConocoPhillips’s representations of a “deal” and promise to negotiate and sign a PSA did not
eclipse the bid procedures precluding its acceptance of an offer until execution of the PSA.13
b. ConocoPhillips’s actions after the December 11th representations
Additionally, ConocoPhillips’s subsequent actions were insufficient to raise a fact
issue on whether the December 11th oral representations constituted waiver of the bid
procedures and acceptance of WTG’s offer. To the contrary, ConocoPhillips’s subsequent
actions negated that it had waived the procedures and accepted WTG’s offer.
In the trial court, WTG emphasized the following statements in the internal e-mails
generated by ConocoPhillips in the days immediately after the December 11th conversation,
discussing the decision to proceed with WTG for SAOU, as opposed to a package sale to
Targa: “We are committed to obtain the best value as well as live with our deals”; and
“Certainly Targa is a great option if those deals fall apart.” Even if these references to
“deals” all meant an agreement with WTG, we employ the same reasoning relative to the emails
as to the representations in the phone conversation regarding a “deal.”14 The e-mails
indeed indicated ConocoPhillips had decided at that point to reach a preliminary agreement
and continue negotiations with only WTG for SAOU. However, they were not unequivocally
inconsistent with ConocoPhillips’s reserving the right to insist on execution of a PSA as
prerequisite to forming a definitive agreement.
24

Rather, these e-mails reflected ConocoPhillips’s view that it had not yet formed a
binding contract, particularly the references to:
! “starting down the road” with WTG;
! “moving forward with due diligence and PSA negotiations”;
! “going down the path” of a sale to WTG;
! being “more confident” of closing with WTG;
! anticipating little risk WTG would “whittle the price down”; and
! considering Targa as an option if “negotiations” and a “deal[s]” with
WTG should “fall apart.”
ConocoPhillips would not have needed to express even the slightest concern that WTG might
“whittle the price down” or the deal could “fall apart” if it believed the parties had already
formed a contract for the amount of WTG’s final bid.
WTG also relied on the December 22nd e-mail from Engle (Morgan Stanley) to WTG
authorizing it to proceed with due diligence and stating, “we believe the two parties are close
enough on the PSA that finalizing that document can be done in an expedious [sic] fashion
(most likely during the week of Jan. 5).” Contrary to WTG’s suggestion, this statement did
not show that ConocoPhillips had accepted WTG’s offer and viewed signing a PSA as
merely a ceremonial step remaining in the process. In his deposition, Engle explained that
“finalizing” meant:
“[T]he two parties would come together . . . and we were always talking about
scheduling aside two or three full days to negotiate the outstanding terms of
the PSA, but . . . who knows when you get the lawyers in the room negotiating
these things, how long that could take, . . . but there were still at least several
days away of negotiation from signing the PSA. . . . After having negotiated
all of the points, finalizing is when the two sides sign the PSA.
Therefore, the Engle e-mail indicated, at most, that ConocoPhillips intended to engage in
negotiating a PSA, which could then be signed by the parties, although this process never
WTG’s post-December 11th communications were somewhat i 15 nconsistent regarding whether it
believed ConocoPhillips had accepted WTG’s offer. On one hand, Freeman’s asking if WTG would be given
the opportunity to submit a revised bid and urging ConocoPhillips to “negotiate” and “finalize”—not just
“sign”—a PSA indicated WTG did not view the parties as already having a binding contract for the amount
of its final bid. Further, WTG cites no portion of the record reflecting that Freeman insisted ConocoPhillips
cease negotiations with the other party because WTG and ConocoPhillips already had a contract. On the
other hand, Davis’s letters, stating the parties had an “agreement” on price and WTG had been “selected”
to purchase SAOU and urging ConocoPhillips to “honor its commitment to accept our bid,” arguably support
that WTG did view the parties as already having a contract. Regardless of WTG’s beliefs, the issue is
whether ConocoPhillips waived the pertinent bid procedures because it reserved the right to unilaterally
change the procedures and was the only party who could do so.
25

materialized. Again, the e-mail was insufficient to show that ConocoPhillips had
relinquished its right to withhold its acceptance until the PSA was actually signed.
In fact, the following communications of ConocoPhillips and Morgan Stanley to WTG
during late December 2003 and January and February of 2004 negate that ConocoPhillips
had waived the bid procedures and accepted WTG bid before execution of a PSA:
! informing WTG that ConocoPhillips was considering another offer
several days before the above-referenced December 22nd e-mail from
Engle to WTG;
! confirming this fact to WTG on the same day Engle sent the abovereferenced
e-mail;
! periodically advising WTG regarding the status of negotiations with the
other party;
! reminding WTG that ConocoPhillips was allowed to negotiate with
another party at any time pursuant to the bid procedures;
! telling WTG it was free to submit a revised bid; and
! referring to WTG as a “good alternative.”15
Fnally, we acknowledge the bid procedures were one-sided in ConocoPhillips’s favor.
In fact, they also provided that ConocoPhillips’s “interpretation of the [bid procedures] shall
be final and binding on all parties submitting a Proposal.” In its summary-judgment
response, WTG asserted that ConocoPhillips “attempt[s] to have everything its way, and to
give itself free reign to do whatever it pleases, regardless of what it has said . . . .” We also
The record reflects 16 WTG conceded in the trial court that summary judgment was appropriate on
its claim for tortious interference with business relationship and, on appeal, WTG does not challenge
summary judgment on this claim.
26

acknowledge that, under our reasoning, it would difficult for WTG to raise a fact issue on
waiver short of an express statement of waiver by ConocoPhillips, whether communicated
to WTG or formulated internally, or its engaging in partial performance of the contract.
Regardless, WTG chose to participate in the process knowing ConocoPhillips precluded its
acceptance of a bid, and essentially reserved the right to change its mind, before execution
of a PSA.

In sum, ConocoPhillips proved as a matter of law there was no meeting of the minds
necessary to form a binding contract because it did not accept WTG’s offer Accordingly, we
sustain ConocoPhillips’s cross-point and uphold the summary judgment in its favor.

IV. TARGA’S MOTION FOR SUMMARY JUDGMENT
In its second issue, WTG contends the trial court erred by granting summary judgment
on its cause of action against Targa for tortious interference with contract.16

The elements of tortious interference with contract are (1) existence of a contract
subject to interference, (2) willful and intentional interference, (3) interference that
proximately caused damage, and (4) actual damage or loss. Powell Indus., Inc. v. Allen, 985
S.W.2d 455, 456 (Tex. 1998). In essence, WTG asserts Targa knew, or should have known,
about the alleged oral contract between WTG and ConocoPhillips and intentionally interfered
by subsequently making a higher offer.

Targa moved for summary judgment on the following grounds: (1) WTG’s claim fails
because there was no valid contract between ConocoPhillips and WTG; and (2) WTG cannot
prove Targa knew, or should have known, about any contract between WTG and
ConocoPhillips and, thus, cannot establish intentional interference. Targa contends it was
27

simply the highest bidder in a competitive auction process that allowed ConocoPhillips to
consider any bid, and negotiate with any party, before execution of a PSA.
In its order, the trial court stated that it granted summary judgment in favor of Targa
on the tortious-interference claim because “[t]he Court has found that no contract existed
between WTG and ConocoPhillips.” However, as we have discussed, the trial court actually
found a fact issue on existence of a contract but ruled any such contract was unenforceable
under the statute of frauds. Therefore, the trial court implicitly denied summary judgment
in Targa’s favor on the ground there was no contract. We construe the trial court’s ruling on
Targa’s motion as concluding the tortious-interference claim failed because there was no
enforceable contract under the statute of frauds. The trial court also analyzed Targa’s
alternate summary-judgment ground “[i]n the interests of completeness.” In essence, the
court found that Targa, when submitting the December 15th bid, did not know, and had no
duty to inquire whether, ConocoPhillips had entered into a contract with another party for
sale of the assets and could not be liable for simply making a superior offer.
On appeal, WTG challenges both rulings. Targa presents a cross-point challenging
the trial court’s conclusion that a genuine issue of material fact existed on whether WTG and
ConocoPhillips entered into a contract. Because we have concluded there was no contract,
we agree that, as a matter of law, Targa is not liable for tortious interference. Therefore, we
sustain Targa’s cross-point and uphold the summary judgment in its favor.
We affirm the trial court’s final judgment in its entirety.

/s/
Charles W. Seymore
Justice

Panel consists of Chief Justice Hedges and Justices Anderson and Seymore.